United States District Court, W.D. Washington, Seattle
ROBIN D. HARTLEY, et al., Plaintiffs,
BANK OF AMERICA, N.A., et al., Defendants.
ORDER GRANTING IN PART BANK OF AMERICA'S MOTION
S. Lasnik United States District Judge
matter comes before the Court on the “Defendant Bank of
America, N.A.'s Motion to Dismiss Plaintiffs'
Complaint.” Dkt. # 20. Plaintiffs filed this lawsuit
against a number of lenders, loan servicers, trustees, and
other banking institutions alleging technical errors and
illegal acts that delayed plaintiffs' ability to modify
their home loan and caused damage. Bank of America
“(BoA”) seeks dismissal of all claims asserted
against it, arguing that they are not plausible based on the
facts alleged. Having reviewed the complaint, the attached
exhibits, and the memoranda submitted by the parties, the
Court finds as follows:
March 2006, plaintiff Robin Hartley executed a promissory
note for $500, 800.00, payable to the order of First Magnus
Financial Corp. Decl. of Douglas A. Johns (Dkt. # 9), Ex.
The note was secured by a deed of trust on real property
located at 17134 111th Ave. NE, Bothell, Washington.
Id., Ex. 3. The deed of trust lists First Magnus as
the lender, Stewart Title as the trustee, and Mortgage
Electronic Registration Systems, Inc. (“MERS”) as
both the beneficiary of the trust and the
“nominee” for the lender. Id.
began having trouble making their mortgage payments in 2008.
At the time, Countrywide Home Loans Servicing LP was
servicing plaintiffs' mortgage and communicated with them
regarding amounts past due and its intent to accelerate the
loan. Id., Exs. 4, 5, and 30. On or about April 29,
2009, Robin Hartley and BAC Home Loans Servicing, LP
(identifying itself as the lender) agreed to modify the loan,
amending and supplementing the original note and deed of
trust to increase the principal balance to $525, 243.52 and
to reduce the annual interest rate. Robin Hartley signed the
Loan Modification Agreement on May 19, 2009. Id.,
Ex. 6. The modification was not countersigned until three
years later, by which time BAC Home Loans Servicing, LP had
merged into BoA. BoA's endorsement appears on a separate
page dated September 10, 2012. Id., Ex. 7.
made their last payment on the loan in July 2009.
April 2012, MERS purportedly assigned its interests as
beneficiary of the deed of trust to Bank of New York Mellon,
as trustee for the certificate holders of CWMBS.
(hereinafter, “CWMBS”). Id., Ex. 9. In
January 2013, a law firm acting on behalf of an unidentified
“Deed of Trust Beneficiary” notified plaintiffs
that they were in default. The notice identified CWMBS as the
owner of the note and BoA as the servicer. Id.,
Ex. 10. Plaintiffs requested mediation, and the
matter was referred by the Washington Department of Commerce.
Months passed while BoA decided whether or not it wanted to
pursue the notice of default, pursue mediation, and/or offer
a loan modification. Id., Ex. 30. Whatever efforts
BoA was prepared to make were cut off when the servicing of
the loan was transferred to defendant Residential Credit
Solutions, Inc. (“RCS”) in or before September
2013. Id., Exs. 12, 13, and 30. The mediator
ultimately concluded that the Beneficiary had not
participated in mediation in good faith under RCW
61.24.163(14) and (16). Id., Ex. 29. The mediator
specifically found that:
[T]he practice and behavior of the Beneficiary servicers
(first Bank of America and subsequently Residential Credit
Servicing) seem out of compliance with the provisions of the
[Washington State Foreclosure Fairness Act]. There was
considerable dysfunction with regard to instructions
delivered to their respective counsel/representatives as well
as a curious lack of responsiveness given the requests by
their counsel for guidance and direction. There [w]as also
multiple and confusing communication from the
[Beneficiary]/servicers directly to the Borrowers. . . . In
this particular case the counsels/representatives for the
beneficiary sought to move the process along but were stymied
in their efforts by their clients. . . . For a mediation
process to extend for more than two years by virtue of two
major transfers (one as to servicer and a second at a later
date to a different counsel) by the Beneficiary has
definitely disadvantaged the Borrower's right to a timely
and fair hearing whilst in mediation . . . .
Id., Ex. 29.
seek dismissal of plaintiffs' claims of quiet title,
breach of the covenant of good faith and fair dealing,
negligence, intentional infliction of emotional distress, and
violations of the Washington Lending and Homeownership Act,
the Washington Consumer Protection Act, the Fair Debt
Collections Practices Act, and 12 C.F.R. §
1024.41(c)(1). The question for the Court in this context
is whether the facts alleged in the complaint or shown by the
attached exhibits present a “plausible” ground
for relief. Bell Atl. Corp. v. Twombly, 550 U.S.
544, 570 (2007).
A claim is facially plausible when the plaintiff pleads
factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged. Plausibility requires pleading facts, as opposed to
conclusory allegations or the formulaic recitation of
elements of a cause of action, and must rise above the mere
conceivability or possibility of unlawful conduct that
entitles the pleader to relief. Factual allegations must be
enough to raise a right to relief above the speculative
level. Where a complaint pleads facts that are merely
consistent with a defendant's liability, it stops short
of the line between possibility and plausibility of
entitlement to relief. Nor is it enough that the complaint is
factually neutral; rather, it must be factually suggestive.
Somers v. Apple, Inc., 729 F.3d 953, 959-60 (9th
Cir. 2013) (internal quotation marks and citations omitted).
All well-pleaded factual allegations are presumed to be true,
with all reasonable inferences drawn in favor of the
non-moving party. In re Fitness Holdings Int'l,
Inc., 714 F.3d 1141, 1144-45 (9th Cir. 2013). If the
complaint fails to state a cognizable legal theory or fails
to provide sufficient facts to support a claim, dismissal is
appropriate. Shroyer v. New Cingular Wireless Servs.,
Inc., 622 F.3d 1035, 1041 (9th Cir. 2010).
allege that any action to foreclose their deed of trust is
barred by the applicable statute of limitations and that they
are therefore entitled to quiet title under RCW 7.28.300.
Dkt. # 1 at ¶ 111. BoA has no ownership or possessory
interest in the property, however, nor does it claim such an
interest. It is therefore not a proper defendant to a quiet
title action. See Kobza v. Tripp, 105 Wn.App. 90, 95
(2001). Plaintiffs acknowledge that their quiet title claim
against BoA fails as a matter of law, but argue that BoA
should remain a defendant on this claim - even though there
can be no liability - so that it can provide information
regarding the amount of the debt that is no longer
enforceable. Complete relief on the claim can be had without
BoA's involvement, however. Nor is the ...